For companies, great ideas are not in short supply. But without someone to translate them into reality, all too often they can go nowhere.
Innovation managers from the SAP Digital Business Services organization in the Middle and Eastern Europe (MEE) region are skilled in spotting topics that generate value for companies and for making these ideas happen.
Andreas Spahn knows the stumbling blocks that prevent companies from pursuing innovation. Most are set up to optimally manage the business model that is making them successful right now.
“All the company’s structures, processes, tools, and cultures are geared toward doing what it has always done,” says Spahn, an innovation and technology architect for the Middle and Eastern Europe (MEE) region in SAP Digital Business Services. “These days, most business leaders and managers know that they have to innovate. The difficult part is putting ideas into operation to help ensure innovations are a success long term.”
For example, if an employee has a good suggestion on how to automate a process but has nowhere to take their idea, then they may not follow it up. Other companies have the opposite problem: They pursue too many ideas at the same time without prioritizing them.
“Many companies find themselves overwhelmed by the pace at which technology is advancing and by how fast business models are changing,” says Spahn. “Or they are unsure how to fit innovating in around their operational business.”
A recent study by Deloitte found that the new technologies and trends (32 percent) themselves are putting companies off innovating. Security concerns (30 percent), lack of technical expertise (25 percent), organizational culture reasons (23 percent), and lack of leadership and digital management skills (23 percent) are other hurdles to innovation.
Innovating Out of the Status Quo
There is no one right way to go about digital transformation. Each company is unique in terms of its size and culture, and how much experience it has with digital technologies. Companies that are particularly innovative tend to have appointed a chief digital officer, set up digital labs or incubators for startups, or actively go out and scout for technologies to drive digital transformation. Others stick to a zero-defect mentality.
When Maria Fay, Spahn, and Lars Friedrich visit companies, the SAP innovation managers start by asking questions: How is the company progressing with its digital agenda? Which topics is it implementing and how? What other new technologies is it considering? Does it already have a strategy for involving a network of partners? How will the success of the innovations be measured?
Relevant digital topics differ from industry to industry, and every department has different priorities. “One company might be on a cost-cutting drive, making process efficiency its priority,” explains Spahn. “Others want to grow and are therefore investing.”
To address different needs, innovation managers have adopted a standard approach. The starting point is an assessment to bring together the business department and IT perspectives and identify joint innovation priorities. Then, selected projects are launched and implemented.
“Together, we identify which topics will really benefit the company and look at whether building a scalable solution really is the answer,” says Spahn, noting that many companies todayare looking to build and sell digital platform models and new digital products and services.
Formats for Practical Innovation Management
How can a company turn a visionary strategy that looks decades into the future into an innovation management structure that sets the parameters of its digital strategy and implements them gradually across business divisions? Friedrich’s answer is a range of formats to suit different requirements. Some customers want to optimize processes, some want to use machine learning for rapid prototyping, and others look to create new digital platform business models.
Friedrich has each customer start with an innovation assessment, a three-hour workshop at which the company and SAP present what innovation means to them. The idea is to understand each company’s narrative and gear it toward the future. “Successful organizations have to think exponentially if they are to tap into openness and transparency in entirely new ways,” says Friedrich.
This is where the future-maker format comes in. SAP experts ask the company to think about which technologies will matter in 2025, 2030, and 2040, and how these future developments influence the business models and business platform models of today. Similar to Gartner’s hype cycle, the technology radar from SAP Innovation Center Network enables companies to look closely at the key technology trends right now and in the future. It rates them for the situation today and for the industry in which the company operates.
Offered by SAP Advisory Services and devised by change management experts at SAP and Germany’s University of Mannheim, the digital capabilities assessment looks at corporate culture. Digital transformation involves change. Companies must be willing to test new ideas early, accept errors, and team up with competitors. They must also make it all about self-organized teams, not the technology. “This type of culture is not typical of traditional manufacturers or companies that have a conventional management style,” says Friedrich.
Innovation managers from SAP can also put companies in touch with other innovation entities in the SAP ecosystem, such as startups in the SAP.iO program and the SAP Startup Accelerator for Digital Supply Chain program.
“When this happens, there is tremendous potential for meeting and addressing specific customer requirements and creating seamless end-to-end processes by integrating SAP solutions,” says Fay. According to her, innovation managers can co-innovate with customers to develop ideas that come about in the exploratory stage and turn them into new SAP solutions.
Hack2Sol and Mode-2-Garage: Tangible Results Within a Week
For a company’s innovation culture to flourish, it must become clear quickly whether ideas will work and should be pursued. One customer in the chemical industry has a dedicated “innovation factory” and is currently working on machine-learning prototypes with SAP Digital Business Services in MEE.
“In just a few weeks, we can tell whether [we] have found the right approach,” says Friedrich. Events such as Hack2Sol, innovative workspaces such as Mode-2-Garage, and HackBots make it simple for companies to team with SAP to build prototypes rapidly. “We often have tangible results within a week that end-customers can validate after each innovation sprint,” notes Friedrich. “What’s more, a company doesn’t have to invest huge sums of money either.”
Going about innovation this way is often vital for getting more people behind an idea, helping prove that is feasible, and creating a solution that is not built on assumptions and genuinely helps end users and customers.
Friedrich explains: “Besides technology, companies also learn what it means to work in an agile environment and quickly focus on the ideas that will benefit users most.
